Unaitas eyes Sh1bn capital in plans to convert into bank

What you need to know:

Share capital of the sacco that recently set up its headquarter in Nairobi’s Cardinal Otunga Plaza now stands at Sh752 million.
At the end of December last year, its capital stood at Sh696 million.
Under its 2014-2018 strategic plan, the society plans to establish itself as a fully-fledged bank after meeting the Central Bank of Kenya statutory requirements.

Financial services firm Unaitas expects its share capital to hit the Sh1 billion mark by the end of this year as the sacco makes preparations to convert into a bank.

Share capital of the sacco that recently set up its headquarter in Nairobi’s Cardinal Otunga Plaza now stands at Sh752 million.

At the end of December last year, its capital stood at Sh696 million, chairman Joseph Ngaai said during the shareholders annual general meeting on Friday.

Under its 2014-2018 strategic plan, the society that was for years headquartered in Murang’a town plans to establish itself as a fully-fledged bank after meeting the Central Bank of Kenya statutory requirements.

However, the chairman said Unaitas plans to establish a unique bank in terms of affordability of products to clients. The firm which is also targeting a Nairobi Securities Exchange listing says it is in consultation with the regulator Capital Markets Authority (CMA).

The firm a few years back fell afoul of CMA after advertising a share sale without an approval. It has since raised capital to build a formidable war chest.

Currently, it is selling shares at Sh10 each for a minimum of 100 shares and has attracted a large number of investors including from the diaspora totalling 135,000.

READ: Unaitas eyes growth segment at Nairobi bourse

“We intend to make our sacco a strategic investor in banking so as to offer our depositors affordable credit through our model bank,” the chairman said. The society targets low- and middle-income groups in an effort to help the country meet its Vision 2030 goals, according to Mr Ngaai.

Unaitas started operations in 1993 as a tea farmers’ savings and credit society in Murang’a under the Muramati sacco name before rebranding three years ago.

Other newly opened branches include Nakuru, Mlolongo and Gatundu. It is soon opening the Kawangware branch. Most of the branches are strategically positioned in high population density areas with a heavy footprint at the bottom of the pyramid.

During the AGM , shareholders approved a dividend of 9 per cent and a bonus issue of one share for every 20 shares held from 2009 backwards, according to the chief executive Tony Mwangi.

Its financial report showed an 81 per cent growth in savings and deposit, rising from Sh2.7 billion in 2012 to Sh3.7 billion.